Daniel Yergin, "The New Map"

all right um welcome uh well hello and welcome everyone to politics and pros live my name is bashan horsley i'm with the event staff politics and pros um before we do begin just want to go over a couple quick items first at any point during this event you can go to the chat section which you can find button for below to access a link to purchase a copy of the new map from politics and pose directly that would be appreciated and of great help secondly i would ask that if anyone has any questions they would like to direct to the author you would put them into the separate q and a box so that we can just try to keep things a little organized here and make sure we can get every question we can on that side i would like to welcome to politics and pros live tonight daniel yergin daniel is a highly respected authority on energy international politics and economics and the pulitzer prize winning and best-selling author of the prize the epic quest for oil money and power the quest energy security remaking of the modern world and shattered peace the origins of the cold war and co-author of commanding heights the battle for the world economy he is vice chairman of ihs market he is joined tonight by susan glasser susan is a staff writer at the new yorker where she writes weekly column on life in trump's washington glasser has served as the top editor of several washington publications most recently she founded the award-winning politico magazine and went on to become the editor of politico throughout the 2016 election cycle she previously served as the editor-in-chief of foreign policy which won three national magazine awards among other honors during her tenure and also susan will be appearing herself on pnp live on thursday october 1 at 8pm with her new book the man who ran washington that said uh turn it over now to you daniel and susan thank you oh well thank you so much uh it is just a delight to be here at politics and pros tonight to sean thank you dan i'm just delighted to be here and congratulations uh you know for all those who are spending your evening with us we appreciate it uh we might not be as entertaining as a presidential press conference but i think you'll learn a lot more and dan is the kind of expert that you can take his word to bank too so he will not be contradicted uh in the course of this hour um seriously this new book dan i have to say it was a delight for me to dig into uh the book which is called the new map uh energy climate and the clash of nations uh as an author who's coming out with a new book in two weeks i have to say you should all buy the book which of course i know as loyal politics and prose uh viewers uh and customers you're all planning to do but it goes without saying i think they have a nice link right there uh in the uh chat function for you and i know dan is uh eager to and happy to sign book plates in the leg too but how's keeping it out of the way dan i i really was eager to dig into this book because i think it it it's an you know an antidote in a way to this moment which you know is not only like turbo charged in the very infinitesimal news cycles that you know aren't just hourly news cycles now but are sort of like minute by minute news cycles uh but you know it it it it's a useful corrective in the sense that you know you're offering us some much longer term thinking uh about the shifting geopolitics of the world not only of course the effect of climate change uh on the the world's map and sort of the energy transformation that's going on but actually what that means in a world of nation states uh and you know questions about globalization and the coronavirus so i feel like it's both super timely but it's also a way for a minute of escaping from the news cycle in a way that i certainly found refreshing uh you know spending the rest of my time watching the sort of daily car crash that is american politics so thank you for that and for affording me some respite why don't i just start by asking you uh what is the new map as you see it uh that's a very provocative notion isn't a mac map a fixed and stable uh perspective what how can how can a map uh change well thank you uh susan and uh thank you for doing this uh particularly because i know that you're gearing up for a very important launch of a very important book about the man who ran washington james baker at a time when washington was very different so i think if that too will provide a very important perspective on our times today so thank you for doing this and i look forward to watching you at politics and pros in two weeks uh secondly i just want to say i know there are people who are watching from all around the country but for those of us who are who live in washington uh politics and prose is not only a treasure but it's really part of our lives in a unique way and it's certainly been mine for a couple of decades now and i think we're all it's one of america's great bookstores and i think uh what they've done with pnp live uh is a very innovative way particularly to deal uh with the life of books and life of ideas in this covert era so uh like susan very pleased to be able to join it tonight on your question uh you know as you say a map suggests stability but really the new map is about disruption and so many different forms of disruption are happening and it really is trying to be a map through that disruption in terms of geopolitics uh in terms of energy in terms of how we live and disruption was a factor even major factor even before covert and of course now is the very fact of doing this this evening shows uh the disruption so that's what i uh tried to do is kind of give a framework and put a lot of pieces together in a very confused time well that's right and i i think one of the questions is whether by the new map you mean that there will be a kind of a rearranging of power dynamics in the world that we might pay less attention to parts of the map that we have been the middle east for example uh when um when my husband and i moved to moscow to become the uh correspondents there for the washington post is a long time ago 20 years ago one of the most interesting things we did before we left is we we went and we had um lunch with uh so an expert here in town whose focus was central asia and he showed us a map that he had had done which uh didn't show you know typical like europe at the center uh of things or you know there's the north america-centric maps we're used to but his was a map with central asia in the center and it changes your perspective really on how you analyze all political events right you see iran right there you see how you know close in fact the sort of underbelly of the former soviet union was to the middle east so just this week we've had this ceremony on the south lawn of the white house with the foreign ministers from uae and bahrain there with president trump uh and benjamin netanyahu uh and it inevitably raises questions of uh can the united states move on from this this uh sort of obsession with the middle east or you know being trapped in the kind of energy dependence and therefore the energy politics that comes with it uh you know is that part of your new map is is i mean really i mean if i say what is the new map at its heart it's the new map of energy and geopolitics and how they go together yeah exactly the way you phrased it as a classic the middle east i mean when i originally started doing it you know it was really just looking at the idea came seeing the change of trade flows and how that map was changing and that was really the kind of dramatic factor and then it really became this metaphor for the world and uh new maps and i think what happened yesterday on the white house lawn is part of the new map and it's part of there's a section called the maps of the middle east and this really is a rewriting of that map and rewriting of the power relationships i think it's partly obviously the us is very involved and yet at the same time it also perhaps is a message that the us may be less interested in the region and the regional powers have to come together and of course it's also you know write a lot about iran turkey saudi arabia the other countries vying for influence and position of course israel and uh you know this is a group coming together that's focused both on iran and on turkey and i think one other thing that was involved too was a year ago a little over a year ago there was a drone attack on a big saudi oil facility and i think drones and cyber attacks say the elements of security in a military sense have changed and i think this is an effort to also address that so it is a you know it is a change in this map it's an it's another big change and i think more will follow from it well it's not surprising in that sense that part of the reason for the rearranging of the power maps of the world is the incredible story here in the united states of uh the rise of uh uh fracking and that making the united states into the world's largest uh uh oil and gas producer in a way that has changed america's relative power in the energy wars it might make it less dependent on the middle east but i think we should talk for a second about an even more surprising finding in the book which was your argument that actually china which we're used to thinking of as a very dependent uh you know on outside countries because it's not able to sustain its own economy through its own uh oil and gas production that china might actually be the winner of the next round of energy transformation i found that to be a really provocative uh and different idea well it is china is um right now it is it's it chinese oil industry actually is like the fifth largest in the world but china's demand has grown so much that china imports 75 of its oil and so in thinking about what has become this new phrase that's used all the time energy transition it was thinking who are the winners who are the losers and china has two big kind of winning positions in it one if it's less dependent on oil than because it moves towards electric cars and so forth that enhances its strategic position vis-a-vis among other people the united states the other is that china has really carved out a leadership position what are called new energies about 70 percent of the world's solar panels come from china that's one reason solar costs have gone down so dramatically and they have uh they dominate the lithium battery supply chains and so you know we move in that direction they're in a very strong position there and so uh you know so you see you know china is kind of looking to the future the only thing i do want to add is that half of the wind and half of the solar in the world is in china but china's also adding three new coal fire plants a month so it's kind of all of the above right well it's not in other words it's not just a sort of gonna be a clean energy superpower but to your point i think you said uh in the book that 80 of the world's battery manufacturing capacity right now is located in china so the supply chain that's right well and that's a striking number if you think that we're moving in that direction but there's another number that kind of blew me away that suggests how much work there still is to be done when it comes to if you want to call it an energy transformation uh the number that you used in the book was essentially that 84 percent of the economy is still dependent on fossil fuels which as i understand it is the exact same percentage more or less as uh it was 30 years ago yeah basically yes exactly so that you know this is big you know we're in a post paris climate conference move but the reality is this dependence is there and on these fuels and that's why in this book is about you know you can't write about energy transition without right about energy and energy is such a important part of geopolitics in general if you're looking at u.s chinese relations or relations with russia or of course the middle east uh you know energy's part of it so you this is the here and now that's um that i try to address and to make sense of in the new map well but just to dig into that number so 84 suggests uh we haven't exactly transformed uh our economies yet although uh you do point out the number of uh depends on coal you know here in the united states has gone down pretty significantly and there has been a rise in things like uh wind and solar you've always been a little bit of a skeptic when you and i have talked before about those alternative energy sources but there's clearly been a change in the last few years well yeah i mean you know one of the things you see is actually energy transitions take a long time modern wind and solar uh energy came from the 1970s and you know in fact in my previous book the quest i you know where did these industries come from and like you know the wind industry was basically born out of uh with out of mating of danish wind machines with california wind policy in the 1980s uh solar was started in the 19 you know modern solar industry two pioneering companies one of them was exxon that you know started it but for 40 years they were very small and they were not economic they're not competitive but technologies mature and around 2010 the cost of wind and the cost of solar started to go down so i write in the book about a shale revolution but there's also a solar revolution in how much solar costs have come down making it much more competitive uh than it was before and that's a change from you know just 10 years ago well but how realistic is it that we're going to see you know a significant move in the say the next decade on that overall number of dependence on fossils well i i think in the next decade it's going to be uh it's really the decades beyond that that you'll see the change because um you know cars the average car in america stays on the road for 12 years so people aren't going to throw away their cars you know you just don't you're not going to change it overnight india is going to continue to grow china is going to continue to grow chinese oil demand is actually back to where it was prior to covet so you know you you don't rebuild the whole base of our economies which is what's really being talked about in energy transition in 10 years and i think even in 30 years you only get you know part way because it's just it's so big and so complex in ways that you know people don't even fully comprehend yeah i think that your background as a historian here uh you know you talk about when was it that uh oil was first uh you know discovered or put to use in the us in the in the 19th century uh and how long until the u.s economy began yeah it took over a century oil discovered in 1859 it took over a century before oil became the dominant energy source in the world um you know coal was the first energy transition you know it started in the middle ages when uh wood became in short supply in england and the price shot up but i said that the really decisive moment i went back can you believe while i researched this book you know when did when was a turning point and i said it's 1709 in january of 1709 when an english metal worker found a way to use coal to make iron more efficiently than wood it took two centuries for coal to become uh 50 of world energy supplies now of course we're in the 21st century we have a lot of technology a lot of money a lot of ingenuity uh and a lot of political determination you know they didn't have that in 1709 but um but it's still the system is just so massive and you know if you look at oil it's used for many more things than uh than just transportation you know a hospital operating room everywhere you look it's plastic the tools that put a stent into the alien heart of a person those are plastic so there's it's more than just uh transportation people tend to think oh oil transportation you know oil is you know sanitary food as well so you know the on this history point um four years ago we heard that that coal was going to miraculously come back uh give us a quick check in reality check on that it's not not coming back right well not come back united states it's going south right now and coal used to be not so many years ago 50 percent of our electricity it's way down and natural gas which was 18 is now about 34 35 wind and solar rising other parts of the world are still using more coal particularly uh in asia but in in you know it's been squeezed out of north america being squeezed down been squeezed out of largely out of europe so let's talk for a second about the united states there has been this uh shale revolution you start the book in fact with the the great and interesting story of how that came to be uh despite really the skepticism of just about everybody um you know how how permanent is that and and how seriously do you take the political backlash against uh fracking right now at a time of growing concern about the environment in the u.s well let me take two parts of it um first it was a few stubborn individuals who really made it happen because the textbook said it was impossible but technology marches on and two technologies were put together it took about 20 years to develop again things don't happen overnight but the scale of it is it made the united states the world's instead of the world's largest import of oil it made the united states uh the largest producer of oil it's created you know a lot of activity for manufacturers in uh the midwest over 200 billion dollars of investment 260 billion 200 billion dollars of investment in uh new factories in the us balance of payments um and it's also been quite a impact on our foreign policy you know but the other side of it as you said there's this people who just don't like it in principle and i you know i worked with the obama administration when they were looking at the environmental questions around it and the conclusion was that if it's properly regulated it's an industrial activity it's it's productive and it's constructive and it seems to be largely uh properly regulated and uh and it's you know it's created several million jobs um but i think the full imp you know people don't understand all those other impacts around it but you know i think also people don't finish the sentence if you said let's ban fracking which i'm not sure you can do it you can restrict it but let's say you know otherwise known as hydraulic fracturing and horizontal drilling to give its complete name what would happen but we still have 280 million cars so what would happen is we'd start importing a lot more oil again and it would really be uh you know beneficial to oil exporting countries because it would create a gap and they would be very happy to fill it and we'd be back to being much more highly dependent on imported oil so that would be the consequence just to be clear have you looked at the um energy plans of uh the two candidates i mean you know there's been a lot of discussion in the campaign so far uh about energy especially in the battleground state of pennsylvania which has now become very uh dependent on fracking is it the major industry especially in western pennsylvania both biden and trump have been there in recent days trump says the body wants to ban fracking biden says he doesn't want to uh why this political focus on this nina well pennsylvania because it's a really important swing state and has a lot of electoral votes and it doesn't take very many votes to have it swing in one direction or another i think the difference you know clearly the trump administration would the second one would continue the path the first one which has been supportive of domestic energy development and donald trump likes to be uh promote us lng sales of liquefied natural gas to other countries particularly if you can take markets away from russia uh i think biden's it's more complicated he's come out with a very ambitious and wide-ranging two trillion dollar climate plan and it would do you know big effort and a lot of directions to move the us in an energy transition towards what's called cleaner energy at the same time as you point out when he was in pennsylvania and he said i'm not going to ban fracking let me repeat i'm not going to ban fracking you know and so i think he uh would look and say well this is an important industry it has a lot of jobs involved in it it's important to the u.s economy and political position so i think it would be a kind of mixed position and i don't think he wants to be the president who would preside over a really rapid increase in u.s oil imports so he has a i mean trump's kind of just down one road biden has a more complex uh position and uh i think it was kind of reflected in that's those statements that he made in pennsylvania the other day but it sounds like your view is that he would essentially uh reflect some of the thinking that you saw in the obama administration you know that they would be supportive but much much more focused on energy transition and the climate than the trump administration that's right really if i can use that phrase it's not an appropriate step on the gas on climate uh but uh but at the same time you know this other industry is there and realizing that you know your climate plan is not going to uh change things in 2025 or 2027 but you know the decade of the 20s would be a preparation for the succeeding decades so let me ask you i want to get back you just mentioned russia for the first time and both of us have a long-standing interest of course in russia let's just finish quickly on the u.s i do you see increasing pressure because of uh what's happening with the climate because of how the world is changing the wildfires in california and the lake do you think republicans are going to give up on their policy of climate change denialism i mean is that gonna well i think i think it's even mixed within the republican party i i don't think there's a unified position on it and you have republicans including somebody that you've uh just written the biography of named james baker who is supporting a carbon tax uh and he you know no one can say he's not a republican so uh you know better than i do so i think it's mixed but i think the forest fires the tragedy the scale the scariness the the destruction of it certainly pushes climate change more to the fore in the campaign and you've seen uh the two candidates really exchanging very sharp words against each other related to uh coming out of the forest fibers well it's interesting i mean you know obviously we don't know what the post-trump republican party sort of official kind of ideology is going to be and whether that's going to be in a few months or four years from now uh you know i do think it'll be interesting to see whether uh essentially that's a position that gets left behind uh and you know in terms of the geopolitical let me just say one thing i mean i think that one of the very first things that the uh biden administration would do is rejoin uh the paris uh climate accord i mean that would be you know almost task number one and so i think there's a lot of momentum to do that so that would be a quick you know maybe like january 21st yeah i think they've said they're going to do it on the first day although they're they're really it's going to be a busy first day because i suspect there's going to be some pandemic related business too uh if it comes to that um so russia okay russia is the other kind of the third pillar of this book in in a way uh and you know it's the area in which russia remains a superpower even though as you point out it's actually got an economy that's smaller than italy's uh because of its uh status as an energy powerhouse as well as still holding nuclear weapons uh it's been able to play an outsized role in the world for these two decades of putin's rule will that continue well i think it's interesting you know one of the big questions i faced in this book was to say whether russia's economy is somewhat smaller than italy's or somewhat larger than spain's decided you know i think most recently just smaller than italy's but not much bigger than spain's and yet as you say uh vladimir putin has succeeded in restoring russia as a great power and a player around the world uh and if biden is president just think about it susan he will have dealt with five u.s presidents he's seen presidents come and go so he has a different perspective but uh he was a great beneficiary of the what's called a super cycle commodity boom in the first decade he came to power uh of the century when oil prices had collapsed and he just rode those prices up and that was you know enabled him to really consolidate uh his position and and use that as a base uh and so russia is still the largest exporter natural gas and it's a major exporter of oil and one of the ways that the world has changed and i described it particularly in a chapter called the plague which deals with what's happened in in 2020 is that you know the frame of reference that many americans have is opec versus non-opec going back really decades but in fact the world of oil now is really the world of the big three which is the united states russia and saudi arabia and we saw that demonstrated just a few months ago in april when it was the united states that when oil prices collapsed uh did this incredible sort of diplomatic act of bringing uh these countries together to stabilize the price and uh you know kind of demonstrated the change but russia is you know is it's 40 to 50 percent of the russian budget comes from uh oil and gas so uh it's a country that depends upon it and you know and that's been a source of uh it's one of the sources as you say of its position in the world what's interesting is that for as long as vladimir putin has been in office and you point out it's it's two decades now uh in fact people are always shocked when i when i say putin is the longest serving leader of russia since joseph stalin uh and at age 67 he could yet surpass him well with the with the constitutional amendment that was passed that he can remain president those in 2036 that gives him a lot of runway to be there longer than stalin it is amazing he's basically president for life well that's right but so but interestingly enough he has not used that time and power to reform russia's economy right it remains a petrol state it remains highly highly dependent on natural resource extraction even now yes uh you know there's a constant discussion about the need for reform to bring in reformers by the economy but the those oil and gas revenues are very attractive i mean russia is a more diversified economy it's the largest exporter of wheat in the world but still oil and gas is at the heart of it and i have an anecdote in the map where i asked actually had the opportunity to ask putin about diversifying his economy but uh by accident i mentioned the word shale and he uh got quite upset with me and started shouting and it was like in front of 3000 people so it was not a comfortable position to be in but i think it it you know it did it there's a talk about reform but it just doesn't happen and people keep thinking something else will happen and then the reforms will begin so far not well what's interesting is that you see obviously the very different course taken by china just across the border and i'm not aware of russia really making any significant inroads or efforts into the kind of technological revolution that will power the next stage of the energy transformation or you know any new energy technologies it's interesting because they're you know they have a very accomplished mathematics and science but yeah that ability to you know and there are many very successful russian entrepreneurs but there happened to be in the united states the culture do it uh but they're you know what we know that they're we know what they're two things that they're good at uh cyber uh intervention uh and uh well we we know that they can do a fast vaccine but um you know which they're apparently now being tested but it's not clear that it's gone through phase three testing so you know um but uh you know they so they they do have considerable scientific technology but it's just they don't have an environment that encourages one of our great strengths is we go from basic science to startups to big companies and no one has that kind of ecosystem that we do and that's a great advantage for the united states yeah so they don't seem to have made any big bets on becoming a new energy powerhouse no no no they're still interested in traditional energy power that's right well what uh and and also traditional geopolitics by the way i mean if anything you could say that russia and putin particularly in his two decades on the world stage has been really a leading proponent of the idea that uh we should return to more of a real politique world of the the 19th century yeah so there's a great you know i have a great photo section in the book and one of it is of this titanium flag that was planted at the bottom of the arctic ocean uh claiming the arctic ocean as you know as a as a russian ocean and i think that the quote was the canadian foreign minister said something like that though this is that's like the 19th century we don't do that anymore but it turns out some people do do that it is very 19th century it's a concert of great powers well that's right and i think and i think i think one of the things we've seen is that you know putin wants to be treated as a great power exactly and he knows how to play that game there's a great picture of him in the book of doing a judo flip and he knows how to take advantage of other people's weaknesses other nations weaknesses well and that's interesting because he as long as he has a seat at the table uh you know a world of great power competition benefits him even though his economy is so much smaller than china's or the united states yeah and the you know the relationship i mean one of the things i talk about in the book that's really important is and it's very you know our relationship with russia for many good reasons has gotten worse and worse things keep happening but and we put sanctions on but he's gotten closer and closer uh to uh china and i describe one scene where uh putin is in front of an audience saying to xi jinping i'm sorry kept you up talking until four a.m you know your time but ms xi jinping said that's fine because we always have we never have enough time to talk i'm sure one of the things they both talk about a lot is their problems with the united states but china basically is the is a supplier kind of modern technology to russia and russia except and weapons russia's a supplier of modern weapons to china which is interesting which they had been resistant to do because they were worried that the chinese would steal the technology but now they say it's a priority but right primarily it's raw materials and so you know i say that the relationship between russia and china used to be based upon marx and lenin and to some considerable degree today it's based on oil and gas well it to that end i mean putin has not hesitated to be really somewhat of a bully in using his resources as a tool in general politics you see that in a lot of how he's dealt with his neighbors over the years ukraine for example there's now the sort of very intense pipeline politics around uh his supply of gas to europe through the nordstrom 2 pipeline which is extremely controversial in germany uh trump has sought to make that a point of tension in the u.s relationship with germany and now with the poisoning of alexei navalny who is um putin's essentially his major internal uh uh rival inside russia and maybe would say even challenger well exactly you know and uh a modern-day dissident it seems um he just was given uh you know flown to germany for medical treatment they confirmed that uh a chemical weapon essentially in the novotalk family was used to poison him there's now talk in germany uh that uh even by leading uh members of uh the parliament there that uh they should consider halting this nordstrom project uh because of russia's actions and that you know so interesting because that's an 11 billion dollar project that was like three weeks away from being finished and uh u.s sanctions stopped it and it was in december and you know sometimes you know you sit down you're writing a book you see how things fit together that you don't see in the flow of news that right when we put the sanctions on that and sort of froze at least turned it into suspended animation uh that's almost within this days uh putin and xi jinping had this very elaborate tripartite ceremony where they turned the the switch on for this huge power of siberia pipeline sending russian gas to china and it was very symbolic of the sort of breakdown over here and this that relationship uh over there and uh to say that that pipeline is controversial would probably even be an understatement right now i mean we're you know if some of the senators have threatened to put sanctions not on russia not on the pipeline but on parts of you know german governmental authorities which is um you know probably in some way uh russia and putin like to see these fissures between the us and its western allies in fact they probably like to see it quite a lot well clearly uh he has seemed to uh both encourage and actively foment those divisions inside our society um in terms of the energy piece do you think that china would act uh as it increasingly grows into being a new energy powerhouse as you predict in the book do you think that they will use uh the same kind of bullying tactics that that uh putin has used well there was one occasion when there was a dispute between uh china and japan where suddenly the rare earth that the japanese manufacturers need to suddenly not available from china i think we're going to see and i would tell people to keep an eye on this over the next year there's going to be a lot more to as they as a climate agenda is pushed it's going to be a lot more attention to the relationship with china and its role in the supply chains for uh renewable energy and uh you know what we've seen with tick tock and huawei you know we could see there'll be an effort to create no alternatives kind of supply chains not to be so dependent on on on china and it's kind of also a symptom of this larger breakdown in the relationship between the us and china which is so different from what it was even five years ago well that's right i mean it might be one thing that uh democrats and republicans broadly speaking agree upon well i think i i think that's absolutely right i think as you know you you you watch washington very carefully one of the few things that democrats and republicans agree on is this kind of uh concern about china i mean maybe the only other thing they agree on is their concern about russia and there's not much else that they agree on but but that china issue has really you know from national security types to uh labor unions to um uh you know a whole host of people i mean it's a real change uh and i call it in the book i said there was this wto consensus when china joined the world trade organization that you know this connection would be good for everybody but now it's um you know that's that's going away and instead to use the language you use before susan it's great power competition strategic rivalry and both the chinese you know i have a section that had broken read both the chinese most recent and the most recent u.s military or defense postures and they both use similar language speaking about each other well so first of all i want to ask those who are listening to us and thank you again dan's book is the new map energy climate and the clash of nations and you can buy it right now on the politics improves website uh you can also ask a question and we will get around to questions soon so go ahead and put any questions that you have in the q a function if you can on your zoom screen that will be the easiest for me uh so please go ahead and type out some questions and we'll be happy to get to them in just a few minutes um in the meantime dan this issue of you know people compared to the cold war is this a new cold war is it a decoupling of the two largest economies in the world is it even bigger is it the end of the globalization era and a renewal of a sort of uh uh muscular nationalism uh as the guiding sort of international hand what's your take well i i think uh i think you've just done a very good summary of it actually that when i was introduced that book my original book on the origins of the cold war was mentioned here you know as i was writing this over the last two years it seemed to me you know are we heading into another cold war and uh and you know commanding heights was about an integrated global economy and now i think it's definitely fragmenting we hear that language about the company i think it's complicated you know because general motors sells more cars uh in china than it does in the united states china is a very important market for apple you know it's a great growth market can we really be couple but no we're certainly moving in that way and a lot of the focus is on technology and technology transfer and the sensitivities about that so uh and then you take south china sea so it's fascinating for me to understand where did the south china sea this view come from it's the most important trade route in the world it's also the sharpest point of contention from a strategic point of view between the united states and and china where you know our ships you know i have in the book several examples where they were near collisions of our of naval vessels so uh you know all of that is unfolding at the same time and you just worry about an accident and kind of the breakdown of communications of channels of communications if something does happen well in a way we've become so inward looking here in you know washington and the united states with our own uh sort of explosively polarized politics i think it's almost distracted from this i mean you know china is a slogan now wielded by the president uh you know when he talks in ethnic derogatory terms about even the virus uh but at the same time there's not that much there's there was more focus from a policy point of view i would say on the south china sea in washington you know in the ancient days of you know four years ago and the obama administration but you know i think that's probably a smart prediction on your part that you know regardless of how much we're paying attention to it that is probably one of the most strategic uh fault lines in the world right now i mean you as a close observer of washington every week uh don't you find it striking how this how it's just the attitudes have changed on both parties absolutely i think there's there's no question uh that one of the interesting effects right of the trump era was trump's rhetoric is very out there uh and yet um coming in behind it it's enabled uh people across the board to recognize that uh you know i think this is a piece by two top obama administration officials who dealt with asia kurt campbell and jake sullivan i was just looking at the other day from last summer and you know they they they too wrote you know the era of strategic engagement you know has come to an unceremonious end uh so you really do have a consensus on that now now i want to get to our questioners but dan i do want to go back to this you know to the middle east and this question of you know essentially how long is energy and energy politics going to dominate uh global politics and you have this fascinating example of uh uh the uae uh just here uh this week making peace that in a way might might be related uh to some of these questions of energy dependence and lack of revenue you read about this incredible example in 2007 you know you write well before the shift away from oil was widely accepted uh abu dhabi laid out its own economic vision for 2030 and the idea was essentially once we've gotten rid of all of our oil you know can we build an economy that makes us no longer a petrol state and you write it's already succeeding in in that a country whose gdp was almost all oil two decades ago is now 60 non-oil so is there something there that uh other people can learn from or is it just that that's such a small country it's able to do things so first for those who you know don't follow geography of course abu dhabi is the largest and the most oil rich and the richest of the um of the emirates that make up the united arab emirates that signed that deal uh yesterday uh i think it really helps that you have a that it's a small population it's as a tradition of uh outward-looking uh the united arab emirates is different from other it's the only country i know that has in its government a minister for tolerance uh so i think uh you know sort of openness and i think it's reflected in this deal but also in doing that and the crown prince uh muhammad bin zayed he said you know should we be sad when the last barrel of oil leaves uh uh abu dhabi or or should we celebrate he said if we diversify our economy we can celebrate so they've done a good job you know good job and you know they could you know to agree a degree a model for other people but i think it's hard to do and you need a lot of ingredients including the human capital to do it well it's very i was just very intrigued by that so i have to say i i wanted to ask you about it so dan we've gotten a lot of good questions uh and i'm going to just jump right into those i want to thank everybody and we'll try to get to as many of them as we can the first question which keeps getting pushed down uh is about iran uh and if you could tell us a bit about um you know the state of its oil economy and here let me see if i can read this okay with regard to the us maximum pressure policy on iran you know what does that do to the future of iran energy exports think about oil and natural gas electricity well but certainly you know it was really a president obama who first used the sanctions on iranian oil to force them to the table and uh that was made possible because of shale because we could replace their oil uh the max then of course the uh trump administration gave up on the nuclear deal walked away from it and put these maximum pressure so they're exporting very little oil uh their condition of their oil industry is not in very good shape because you know just they haven't been able to invest and uh access to technology and so forth so their country with large resources and oil and gas but they're not actually a very significant player right now uh as long as those you know sanctions are in place and the u.s has this great tool that it can use in foreign affairs which is called the dollar and the the fact that transactions flow through the dollar and that is how they turn the wrench on sanctions so right now uh in terms of oil and gas particularly oil because they really haven't gotten their gas exports together iran is sitting on the sidelines interesting um here's here's from a fan of yours uh donna sangamino she says i really enjoyed the prize uh your book of course about oil uh the history of it what do you think juan pablo perez alfonso the father of opec as you referenced in that book what would he say about what is happening right now to his homeland in venezuela so he was one of the two fathers of opec he got the idea from opec by actually looking at what was the texas railroad commission which actually regulates oil production in texas uh but he was scathing in a sense too about dependence on oil and and the he called it the devil's excrement in terms of what it would do to a country and i think he would look at venezuela today and just say how is this opportunity wasted how did this disaster happen country with the largest oil reserves in the world producing almost nothing it's economy you know mothers if they can going across the border to just have their babies because there's no medicines in the hospital in caracas how was this how was this all wasted i think he would be shocked about it beyond shocked and saddened by the what the outcome has been yeah thank you for the question and thank you for the prize incredible tragedies um okay here's two quick uh lightning round questions uh having to do with uh oil and uh gas eric ridgely writes assuming economics drive consumer choices as opposed to fads and assuming that environmental rules are more or less the same as they are now and coronavirus goes away uh miraculously or not he says due to vaccines not due to a miracle um he's looking for your idea about what's the equilibrium price of rent crude oil and wti crude oil for say 2030 oh my gosh i went to the study on oil price forecasting called the perils of prophecy that yes there's a reason oil price forecasts are often wrong because there's so much else that's involved technology uh markets regulation so uh i i wouldn't i couldn't guess i thought you were going to sort of say next year and take a stab at that but uh 20 30. could also say if you know and you're not going to tell him yeah that's right i actually want to keep it quiet i don't want it to get out no it's a wonderful question but it's just i think you know you look at the history of forecasting it just misses things because it misses big you know not only market but you know a financial crisis in 2008 it misses the you know the coronavirus and there'll be other things that will will happen but i think that um you know big debate right now is when does oil demand reach its peak and begin to decline and some are now thinking it's looking at where we are today uh covert that it happens in the 2020s i i tend to still think it's in the 2030s but i think we still don't really know what the lasting consequences and the economy are of of this really this disaster that we're living through you know if you go through cities you see boarded up shops all these small businesses that are you know that are just lost and they're not going to be able to come back but also look at how we're communicating tonight what is this you know is the nature nature of work and i i in the in the in the new map i speculate and say you know to a considerable degree perhaps the office of the future is going to be at home well for some of us that's good news for some it's not uh brian okonsky writes my understanding is that operators do not disclose the chemicals that are used in fracking these chemicals could affect water supplies do you expect that they will be disclosed and also regulated in the future well i think now i'd have to search i mean that was a big issue around 2012 i think i think just i i do believe now i mean i will double check but i remember i do believe that they disclosed there was a sensitivity at the beginning about it so i think there's a lot of uh information now about jerry grossman uh writes why do you say that republicans and democrats agree about russia concerns it seems to jerry that the senate republicans are in agreement with the president that russia is our best buddy oh no i don't think uh you know my reading of it since um three of us of the republican senators are the ones who are introducing the bill to put sanctions on uh on this at this governmental authority in germany because of nordstrom 2 because it quote threatens our national security i would say they are not on board with the president i think there's a kind of i mean there is i mean clearly the arguments about the impact the mueller question the impact on our elections and uh how that worked and interventional that sort of thing but i think that if you look at you know the republicans voted for the sanctions too that were put on nordstrom last uh december so i think there's kind of the president over there and even his messages are mixed you know on the one hand this on the other hand you know complaining to chancellor merkel why are you buying gas from russia when you could buy it from the united states that is one of the mysteries he he on the one hand constantly uses that as a club against merkel on the other hand uh you know you can't imagine someone who has been more uh favorably inclined toward putin than trump so it's it's very i mean he one thing is pretty clear he doesn't he doesn't he does not have a great relationship with castle merkel despite what we were recently told about their great chemistry yeah exactly the great crimes apparently when she was somebody asked her about that she just had a kind of quizzical look on her face yeah the video is very funny of that um okay we got a number of really good questions uh more energy focused um uh michael nix asks uh when do you see the uh uh utility level storage being able to take full advantage of wind and solar energy and making those intermittent sources much less intermittent that's the big issue with that so for those who don't follow you know just to explain what that means wind and solar by intermittent means the sun has to shine the wind has to blow and you see in california when that doesn't occur then you end up with brownouts and so forth and you need natural gas to balance the supply so uh i was just talking you know at a virtual conference on the electric utility industry and there's a big drive to move towards renewables to you know move towards lower and lower carbon and so forth but i mean the big blocking item is storage of renewable energy so i would say batteries you know the thing to keep your eye on is large-scale batteries not you know batteries that just last for two hours but that you can really start large amounts of power and if that happens that would constitute you know i don't want to use the word revolutionary but it would mean a major change in the system a couple more that are you know in related to this question of the energy transformation craig glazer asks what are the implications here uh very aggressive renewable requirements coming from states and from the biden campaign of up to 80 of electricity consumption coming from renewable resources by 2030 and what the recent california experience tell us about whether such policies are workable well i think you i think the question has answered it that uh you have to you know the stability of the system you know running a electric power grid is a really complicated thing because you have to deliver power i mean look what we're doing in fact the whole system is more and more dependent upon reliable electricity and i think they're real questions about being able to run a system you know at that level um you know 80 on a renewable basis that just the capabilities not there and i think the california case has to be looked at to help understand about pacing and scale of it so that's a you know that's a very good uh uh pointer uh and you know that's a lot of that would be a lot of investment to to do that on top of everything else so i think uh i think you know if you look out another decade by 2040 you you start to see you know much higher volumes but that question of storage electricity has that has to that's one of the great technological frontiers that has to be crossed we're almost out of time we'll try to get uh two quick ones more elizabeth calamari asks about the introduction of the electric car and how is that affected gas prices and do you have any thoughts about the future of these electric cars and how that might affect oil and gas industry well there's a great two great pictures in the book of thomas edison standing next to his electric car and elon musk standing next to his electric car and it's like elon musk is the reincarnation of thomas edison because his electric car didn't didn't gain traction the the tesla has certainly gained traction uh and i guess tesla was also sort of i hadn't thought about it kind of edison's great opponent so that makes it even more interesting uh so i think he's established a brand and he's established legitimacy and you're seeing the automobile industry seeking to pivot but it still depends upon you know pretty considerable support and incentives from governments and so i think a lot of the speed of electric cars will partly depend upon governments and then the other part of it is uh is the large number of consumers want them and when will they want them so uh you know the in the book you know we've done a lot of scenario work and you know we have 1.4 billion cars in the world maybe by 2050 we'll have 2 billion and estimate maybe 600 million of them about 40 will be electric cars maybe the number will be higher government policy or if they're again advances in the battery but all the major automobile makers are gearing up to move in an elect ev direction well and i guess that momentum uh once it once it gets going right it's it's hard to turn it around as you document in the book we are just about out of time uh for one last time in case you haven't already bought the book the new map energy climate and the clash of nations uh i'm shamelessly flacking for the book so that dan doesn't have to at least for this moment but you really should buy it and uh i'm sure dan will be happy to uh sign your copies or stop in the bookstore sometime and do that too dan one final effort at uh prognostication the the questioners all seem to want you to tell them the future uh this one wants to know if opec will still even be around in 10 years so let's close on that okay well i think opec will be around sort of more as a trade association uh than the opec of the fierce opec that we knew of the 70s or 80s so let me thank you susan let me thank politics and prose and say that we should all tune in on october 1st for the man who ran washington for some guidance for thinking about not only the past but also to think about the future so thank you susan thank you everybody for joining us and thank you politics and pros yes thank you very much i thought those were great questions uh and uh thanks again to everyone for tuning in and have a great week thank you

Channel: Politics and Prose

Views: 5,038

Keywords:

Id: JyhNXvvjYxw

Length: 58min 11sec (3491 seconds)

Published: Fri Sep 18 2020